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Social and Behavioral Sciences Commons™
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Full-Text Articles in Social and Behavioral Sciences
Digital Payments And Consumption: Evidence From The 2016 Demonetization In India, Sumit Agarwal, Pulak Ghosh, Jing Li, Tianyue Ruan
Digital Payments And Consumption: Evidence From The 2016 Demonetization In India, Sumit Agarwal, Pulak Ghosh, Jing Li, Tianyue Ruan
Research Collection School Of Economics
We study how consumer spending responds to digital payments, using the differential switch to digital payments across consumers induced by the sudden 2016 Indian Demonetization for identification. Usage of digital payments rose by 3.38 percentage points and monthly spending increased by 3% for an additional 10 percentage points in prior cash dependence. Spending remained elevated even when cash availability recovered. Robustness analyses show that the spending response is not driven by income shocks, credit supply, price changes, or consumers' moving to the formal market. We provide evidence that digital payments increase consumer spending due to subdued salience.
Smarter Banking: Blockchain Technology In The Indian Banking System, Suparna Dhar, Indranil Bose
Smarter Banking: Blockchain Technology In The Indian Banking System, Suparna Dhar, Indranil Bose
Asian Management Insights
Indian banks are currently experiencing poor performance when it comes to debt risk. Burdened with high non-performing loans (NPL), they are putting at risk the funds of investors as well as India’s industrial and economic growth. In addition, the loan management process itself is riddled with inefficiencies. To overcome them, we propose to use blockchain technology.